- 14 Mar 2002
- Reaction score
The G-7 faces dealing with 窶労apan disease窶兌/B]
Topping the list of issues the Group of Seven nations should discuss in Paris this weekend is keeping 窶廱apan Diseaﾂｭse窶 from breaking out around the globe. [...] 窶廱apan Disease窶 symptoms abound in Hong Kong, for example. Deflation, rising unemployment and waning consumer spending are being met with policy paralysis at the government窶冱 highest levels. Usual tools like fiscal spending and lower borrowing costs have done little. [...] And admittedly, G-7 pressure hasn窶冲 worked with Tokyo. It has long since stopped putting Japan on the spot, not out of tolerance, but resignation. Efforts over the last decade to encourage Japanese policy makers to repair the world窶冱 second-biggest economy accomﾂｭplished nothing. [...] That窶冱 certainly the cautionary tale offered by Japan. For all the bellyaching about the Bank of Japan not fighting deflation, short-term rates here have been at zero percent, or just about, for years. Even today, easy money policies eliminate incentives for the government to act to repair the banking system, increase compeﾂｭtition and reduce public debt levels. Tokyo has showed the world how not to run an economy. For those who don窶冲 learn from those mistakes, 窶廱apan Disease窶 awaits.